If anything, it has even gained momentum with Bangko Sentral ng Pilipinas (BSP) recognizing three more virtual cryptocurrency exchanges (VCEs) and the Cagayan Economic Zone Authority (CEZA) issuing more licenses for both cryptocurrency exchanges and financial technology (fintech) companies.
In an article posted on their website, VOA quoted Banco de Oro Unibank (BDO) Chief Market Strategist Jonathan Ravelas when he pointed out the rapid growth of the fintech sector in the Philippines as one of the reasons of this phenomenon.
“Fintech appears to be very advanced in the Philippines, ” Ravelas says. “Consumers eventually look at the mobility of having it in mobile wallets, (which) gives them flexibility to use money.”
Apart from gains in the fintech sector, VOA also cites growing popular demand for cryptocurrency exchanges not only in the Philippines but in the entire Southeast Asian region as a reason behind the momentum.
Just last week, Singapore’s biggest e-commerce company Qoo10 announced its plans to use blockchain technology as it widens its reach in Southeast Asia. This move is seen to help bolster Q*coins, its cryptocurrency of choice.
Such opportunities for VCEs are predicted to multiply exponentially in the coming years. BDO’s Ravela says this is because many countries in Southeast Asia are still very much cash-based. “In the Philippines alone, seven out of ten Filipinos do not have bank accounts,” Ravela explains in an interview with VOA. “VCEs add another option for them to make transactions without having to open bank accounts.”
Countries like Cambodia, Vietnam, Thailand, and Laos tell similar stories.
Cryptocurrency exchanges can seem to rely on the Philippines’ growing affinity for this type of business. Evidence of this, VOA says, lies in leniency in regulations and the BSP governor’s own interest in cryptocurrency trade.
With other countries like China and South Korea clamping down on VCEs, Initial Coin Offerings (ICOs) and blockchain technology, cryptocurrency exchanges turn to more friendly territories, Philippines included. While the country’s Security and Exchanges Commission (SEC) has yet to issue rules on ICOs, BSP and CEZA have been busy issuing licenses for VCEs.
No less than the BSP Governor Benjamin Diokno himself expressed in the past his interest in cryptocurrency trade. He even went as far as saying that it is the future for most processes including government operations.
This support for cryptocurrency exchanges, VOA says, has its advantages. The agency quoted crypto-specialized news website Crush the Street in the United States CEO Kenneth Ameduri when he said that if the Philippines does it right, the capital is going to flow in while other jurisdictions completely miss out.
But it comes with a caveat. The Philippines has to strengthen its regulations to some degree says Moody’s Sovereign Risk Group Vice President and Senior Credit Officer Christian de Guzman. “The Philippines should look into it since unabated use of cryptocurrency exchanges may be used for nefarious purposes such as falsifying tax payments and paying for illegal drugs, ” De Guzman says.